diff --git a/homeassistant/components/otbr/__init__.py b/homeassistant/components/otbr/__init__.py
index c2020402283..78c5893c889 100644
--- a/homeassistant/components/otbr/__init__.py
+++ b/homeassistant/components/otbr/__init__.py
@@ -9,11 +9,14 @@ from typing import Any, Concatenate, ParamSpec, TypeVar
 
 import aiohttp
 import python_otbr_api
+from python_otbr_api import tlv_parser
+from python_otbr_api.pskc import compute_pskc
 
 from homeassistant.components.thread import async_add_dataset
 from homeassistant.config_entries import ConfigEntry
 from homeassistant.core import HomeAssistant
 from homeassistant.exceptions import ConfigEntryNotReady, HomeAssistantError
+from homeassistant.helpers import issue_registry as ir
 from homeassistant.helpers.aiohttp_client import async_get_clientsession
 from homeassistant.helpers.typing import ConfigType
 
@@ -23,6 +26,18 @@ from .const import DOMAIN
 _R = TypeVar("_R")
 _P = ParamSpec("_P")
 
+INSECURE_NETWORK_KEYS = (
+    # Thread web UI default
+    bytes.fromhex("00112233445566778899AABBCCDDEEFF"),
+)
+
+INSECURE_PASSPHRASES = (
+    # Thread web UI default
+    "j01Nme",
+    # Thread documentation default
+    "J01NME",
+)
+
 
 def _handle_otbr_error(
     func: Callable[Concatenate[OTBRData, _P], Coroutine[Any, Any, _R]]
@@ -70,21 +85,65 @@ async def async_setup(hass: HomeAssistant, config: ConfigType) -> bool:
     return True
 
 
+def _warn_on_default_network_settings(
+    hass: HomeAssistant, entry: ConfigEntry, dataset_tlvs: bytes
+) -> None:
+    """Warn user if insecure default network settings are used."""
+    dataset = tlv_parser.parse_tlv(dataset_tlvs.hex())
+    insecure = False
+
+    if (
+        network_key := dataset.get(tlv_parser.MeshcopTLVType.NETWORKKEY)
+    ) is not None and bytes.fromhex(network_key) in INSECURE_NETWORK_KEYS:
+        insecure = True
+    if (
+        not insecure
+        and tlv_parser.MeshcopTLVType.EXTPANID in dataset
+        and tlv_parser.MeshcopTLVType.NETWORKNAME in dataset
+        and tlv_parser.MeshcopTLVType.PSKC in dataset
+    ):
+        ext_pan_id = dataset[tlv_parser.MeshcopTLVType.EXTPANID]
+        network_name = dataset[tlv_parser.MeshcopTLVType.NETWORKNAME]
+        pskc = bytes.fromhex(dataset[tlv_parser.MeshcopTLVType.PSKC])
+        for passphrase in INSECURE_PASSPHRASES:
+            if pskc == compute_pskc(ext_pan_id, network_name, passphrase):
+                insecure = True
+                break
+
+    if insecure:
+        ir.async_create_issue(
+            hass,
+            DOMAIN,
+            f"insecure_thread_network_{entry.entry_id}",
+            is_fixable=False,
+            is_persistent=False,
+            severity=ir.IssueSeverity.WARNING,
+            translation_key="insecure_thread_network",
+        )
+    else:
+        ir.async_delete_issue(
+            hass,
+            DOMAIN,
+            f"insecure_thread_network_{entry.entry_id}",
+        )
+
+
 async def async_setup_entry(hass: HomeAssistant, entry: ConfigEntry) -> bool:
     """Set up an Open Thread Border Router config entry."""
     api = python_otbr_api.OTBR(entry.data["url"], async_get_clientsession(hass), 10)
 
     otbrdata = OTBRData(entry.data["url"], api)
     try:
-        dataset = await otbrdata.get_active_dataset_tlvs()
+        dataset_tlvs = await otbrdata.get_active_dataset_tlvs()
     except (
         HomeAssistantError,
         aiohttp.ClientError,
         asyncio.TimeoutError,
     ) as err:
         raise ConfigEntryNotReady("Unable to connect") from err
-    if dataset:
-        await async_add_dataset(hass, entry.title, dataset.hex())
+    if dataset_tlvs:
+        _warn_on_default_network_settings(hass, entry, dataset_tlvs)
+        await async_add_dataset(hass, entry.title, dataset_tlvs.hex())
 
     hass.data[DOMAIN] = otbrdata
 
diff --git a/homeassistant/components/otbr/manifest.json b/homeassistant/components/otbr/manifest.json
index 24fb89f2140..0a6482b040e 100644
--- a/homeassistant/components/otbr/manifest.json
+++ b/homeassistant/components/otbr/manifest.json
@@ -8,5 +8,5 @@
   "documentation": "https://www.home-assistant.io/integrations/otbr",
   "integration_type": "service",
   "iot_class": "local_polling",
-  "requirements": ["python-otbr-api==1.0.4"]
+  "requirements": ["python-otbr-api==1.0.5"]
 }
diff --git a/homeassistant/components/otbr/strings.json b/homeassistant/components/otbr/strings.json
index 58b32276ba8..a05c3f3e926 100644
--- a/homeassistant/components/otbr/strings.json
+++ b/homeassistant/components/otbr/strings.json
@@ -14,5 +14,11 @@
     "abort": {
       "already_configured": "[%key:common::config_flow::abort::already_configured_service%]"
     }
+  },
+  "issues": {
+    "insecure_thread_network": {
+      "title": "Insecure Thread network settings detected",
+      "description": "Your Thread network is using a default network key or pass phrase.\n\nThis is a security risk, please create a new Thread network."
+    }
   }
 }
diff --git a/homeassistant/components/thread/manifest.json b/homeassistant/components/thread/manifest.json
index 16fadd9b06e..547def83450 100644
--- a/homeassistant/components/thread/manifest.json
+++ b/homeassistant/components/thread/manifest.json
@@ -7,6 +7,6 @@
   "documentation": "https://www.home-assistant.io/integrations/thread",
   "integration_type": "service",
   "iot_class": "local_polling",
-  "requirements": ["python-otbr-api==1.0.4", "pyroute2==0.7.5"],
+  "requirements": ["python-otbr-api==1.0.5", "pyroute2==0.7.5"],
   "zeroconf": ["_meshcop._udp.local."]
 }
diff --git a/requirements_all.txt b/requirements_all.txt
index 109d88605b6..f733c0fcaf3 100644
--- a/requirements_all.txt
+++ b/requirements_all.txt
@@ -2097,7 +2097,7 @@ python-nest==4.2.0
 
 # homeassistant.components.otbr
 # homeassistant.components.thread
-python-otbr-api==1.0.4
+python-otbr-api==1.0.5
 
 # homeassistant.components.picnic
 python-picnic-api==1.1.0
diff --git a/requirements_test_all.txt b/requirements_test_all.txt
index 8e4c697c7c9..5248e53e3f9 100644
--- a/requirements_test_all.txt
+++ b/requirements_test_all.txt
@@ -1490,7 +1490,7 @@ python-nest==4.2.0
 
 # homeassistant.components.otbr
 # homeassistant.components.thread
-python-otbr-api==1.0.4
+python-otbr-api==1.0.5
 
 # homeassistant.components.picnic
 python-picnic-api==1.1.0
diff --git a/tests/components/otbr/__init__.py b/tests/components/otbr/__init__.py
index 2180a091eb7..a133f6fda30 100644
--- a/tests/components/otbr/__init__.py
+++ b/tests/components/otbr/__init__.py
@@ -6,3 +6,15 @@ DATASET = bytes.fromhex(
     "0FE2AAF60510DE98B5BA1A528FEE049D4B4B01835375030D4F70656E5468726561642048410102"
     "25A40410F5DD18371BFD29E1A601EF6FFAD94C030C0402A0F7F8"
 )
+
+DATASET_INSECURE_NW_KEY = bytes.fromhex(
+    "0E080000000000010000000300000F35060004001FFFE0020811111111222222220708FDD24657"
+    "0A336069051000112233445566778899AABBCCDDEEFF030E4F70656E54687265616444656D6F01"
+    "0212340410445F2B5CA6F2A93A55CE570A70EFEECB0C0402A0F7F8"
+)
+
+DATASET_INSECURE_PASSPHRASE = bytes.fromhex(
+    "0E080000000000010000000300000F35060004001FFFE0020811111111222222220708FDD24657"
+    "0A336069051000112233445566778899AABBCCDDEEFA030E4F70656E54687265616444656D6F01"
+    "0212340410445F2B5CA6F2A93A55CE570A70EFEECB0C0402A0F7F8"
+)
diff --git a/tests/components/otbr/conftest.py b/tests/components/otbr/conftest.py
index d02524cb615..ac120b3e164 100644
--- a/tests/components/otbr/conftest.py
+++ b/tests/components/otbr/conftest.py
@@ -20,7 +20,11 @@ async def otbr_config_entry_fixture(hass):
         title="Open Thread Border Router",
     )
     config_entry.add_to_hass(hass)
-    with patch("python_otbr_api.OTBR.get_active_dataset_tlvs", return_value=DATASET):
+    with patch(
+        "python_otbr_api.OTBR.get_active_dataset_tlvs", return_value=DATASET
+    ), patch(
+        "homeassistant.components.otbr.compute_pskc"
+    ):  # Patch to speed up tests
         assert await hass.config_entries.async_setup(config_entry.entry_id)
 
 
diff --git a/tests/components/otbr/test_init.py b/tests/components/otbr/test_init.py
index 7818d736e0e..9261004ec1c 100644
--- a/tests/components/otbr/test_init.py
+++ b/tests/components/otbr/test_init.py
@@ -10,8 +10,15 @@ import python_otbr_api
 from homeassistant.components import otbr
 from homeassistant.core import HomeAssistant
 from homeassistant.exceptions import HomeAssistantError
+from homeassistant.helpers import issue_registry as ir
 
-from . import BASE_URL, CONFIG_ENTRY_DATA, DATASET
+from . import (
+    BASE_URL,
+    CONFIG_ENTRY_DATA,
+    DATASET,
+    DATASET_INSECURE_NW_KEY,
+    DATASET_INSECURE_PASSPHRASE,
+)
 
 from tests.common import MockConfigEntry
 from tests.test_util.aiohttp import AiohttpClientMocker
@@ -19,6 +26,7 @@ from tests.test_util.aiohttp import AiohttpClientMocker
 
 async def test_import_dataset(hass: HomeAssistant) -> None:
     """Test the active dataset is imported at setup."""
+    issue_registry = ir.async_get(hass)
 
     config_entry = MockConfigEntry(
         data=CONFIG_ENTRY_DATA,
@@ -35,6 +43,39 @@ async def test_import_dataset(hass: HomeAssistant) -> None:
         assert await hass.config_entries.async_setup(config_entry.entry_id)
 
     mock_add.assert_called_once_with(config_entry.title, DATASET.hex())
+    assert not issue_registry.async_get_issue(
+        domain=otbr.DOMAIN, issue_id=f"insecure_thread_network_{config_entry.entry_id}"
+    )
+
+
+@pytest.mark.parametrize(
+    "dataset", [DATASET_INSECURE_NW_KEY, DATASET_INSECURE_PASSPHRASE]
+)
+async def test_import_insecure_dataset(hass: HomeAssistant, dataset: bytes) -> None:
+    """Test the active dataset is imported at setup.
+
+    This imports a dataset with insecure settings.
+    """
+    issue_registry = ir.async_get(hass)
+
+    config_entry = MockConfigEntry(
+        data=CONFIG_ENTRY_DATA,
+        domain=otbr.DOMAIN,
+        options={},
+        title="My OTBR",
+    )
+    config_entry.add_to_hass(hass)
+    with patch(
+        "python_otbr_api.OTBR.get_active_dataset_tlvs", return_value=dataset
+    ), patch(
+        "homeassistant.components.thread.dataset_store.DatasetStore.async_add"
+    ) as mock_add:
+        assert await hass.config_entries.async_setup(config_entry.entry_id)
+
+    mock_add.assert_called_once_with(config_entry.title, dataset.hex())
+    assert issue_registry.async_get_issue(
+        domain=otbr.DOMAIN, issue_id=f"insecure_thread_network_{config_entry.entry_id}"
+    )
 
 
 @pytest.mark.parametrize(